Gary Stocker compares the financial health of Canisius, Ithaca, and Skidmore colleges from 2014 to 2019, showing how enrollment declines and rising expenses are straining budgets despite solid endowments. All three face pressure to cut faculty or programs, though closure is unlikely.
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Hi, this is Gary Stocker. Today's college viability review is for 3 private colleges in New York State. They are Canisius College, Ithaca College, and Skidmore College. What we're going to see today is 3 private colleges, all of which have had enrollment issues, strong endowments, and have serious issues balancing expenses with revenues from the last reporting period of 2014 to 2019, and the status from the National Center for Education Statistics. We can see that each of the 3, Canisius, Ithaca, and Skidmore, each have had enrollment issues, each have lost enrollment, And you can see that Canisius has some serious problems, Skidmore not as much, and Ithaca kind of in between. They've lost a couple hundred students over the last 6 years. But the real challenge has to do with tuition and fees and the balance of expenses and revenues. We can see that of these 3, that both Canisius and Ithaca have lost revenue, had decreased revenue from the tuition and fees they've collected for that 2014 to 2019 period. Canisius almost $16 million and Ithaca almost $8 million. Skidmore, to their credit, even though they have lost about 47 students over the 6 years, they have been able to grow their tuition and fees revenue. We'll see why here in a couple minutes. Let's then take a look at the balance, or in this case imbalance, between expenses for those 6 years and change in revenues over those 6 years. We can see that Canisius has tried to keep their expenses in control. They have decreased their expenses a little over $14 million over the 6 years, but their revenue has gone down about $21 million. So about a $7 million imbalance in expenses over revenues. On the other hand, Ithaca, not doing well at all, and we see this in the media, their expenses have gone up almost $20 million, the revenues have gone down almost $12 million. That's a $32 million imbalance where the expenses have grown and the revenue has decreased. I'll tell you, tell you what that means here in a second. And when we look at Skidmore, we see a similar pattern: $21 million in increased expenses and about $19 million in decreased revenue. Here's what that means really in all three of these cases. As you'll see in a minute, it's not likely that any three of these colleges close. They have a strong endowment, decent enrollment numbers, they're just not going to close. But the pattern that we see, and we've seen this in the news for all three, they are at increased risk for cutting faculty and staff, for cutting programs, for cutting majors, because even though they have a decent endowment, they still need to manage expenses over revenue, and none of the three have been able to do that. Let's take a look at those endowment numbers. And really in each of these three colleges' cases, they're doing all right. Canisius at $129 million, our threshold, our minimum threshold is about $50 million. And both Ithaca and Skidmore with really strong endowments over $300 million, Skidmore almost $400 million. That shows the capacity not just to have good endowment balances, but they have the systems and processes in place to get those gifts from alumni and friends in the community and others in their organization. I also want to look at two factors that can impact a college's interest in negotiating tuition payments, tuition costs to students. And it's kind of an inside baseball kind of analysis, but I think we can explain it here. And there's two things we want to look at. We want to look at the admissions yield. It's kind of a popularity contest. It reflects the number or the percentage of students who choose a college that has admitted them. So the higher the number, the more popular— I'm putting that in quotes— the more popular the college to students. And so we can see that while these are pretty close, that Skidmore has a more consistent yield at about 1 in 5. So for every 100 students that Skidmore accepts 20, show up on their door when they start college, usually in the fall. Let's take a step back and look at the percent admitted. And this reflects how many students whose applications are received at a college admitted them. So we can see some significant disparities here. We'll just look at the numbers for 2019. We can see that Canisius admits 83%, or 83 out of every 100 students who apply. And you can see the numbers for Ithaca and Skidmore. Skidmore at 30% is going to be considered, especially by comparison, a selective college. They don't accept as many students as colleges that we can see for Canisius and Ithaca. Here's how you use this when you're looking at tuition costs for your students. The higher the percent admitted and the lower the yield rate suggests that a college is what's called "willing to buy" your student. And when I say "willing to buy" your student, they're willing to offer more discounts. So using numbers like percent admitted and, and admissions yield as a comparison of colleges— and you can do this on the College Viability app— you can find yourself a better tuition deal for your student. This, of course, is just a brief review of these three colleges. If you'd like more information or more detailed information on these or other colleges, drop me a note in the description below or at the name I'll tag on to the end of this video, and I'll be glad to do that research for you. In addition, if you would like to invite me for a virtual event for college preparation classes or college preparation events for students this fall, feel free to do the same as well, and we can do the same kind of customized comparison of private colleges for you, your students, and their families.
